[Insight & Opinion] For Whom the Bell Tolls

Excessive Criticism and Regulation Targeting Coupang
Designing Rational Alternatives Over Corporate Sanctions

Coupang seems to have become a public enemy. Following incidents such as personal information leaks and the death of a dawn delivery worker, even the president has issued a warning, and all relevant authorities, including the National Assembly, appear poised to take severe action. They are applying pressure through strong regulations, business suspensions, and calls for the punishment of the founder.

While personal information leaks or worker deaths are incidents that should never occur, these have also happened at other large companies, including major telecom and financial firms. Yet, Coupang is being singled out more than others.

South Korea's serious industrial accident fatality rate stands at 3.9 per 100,000 people, which is higher than the OECD average of 2.6. This is because the country has a higher proportion of industries such as construction, manufacturing, and distribution compared to services, and subcontracting is deeply entrenched, making safety management structurally vulnerable. In other words, while Coupang’s dawn delivery workers may have long hours and face higher risks, this is not a problem unique to Coupang.

Over 90% of Coupang’s dawn delivery workers are opposed to a ban on dawn deliveries. If dawn delivery is banned and individual incomes decrease, workers may have to seek second or third jobs during their remaining hours, potentially increasing their risk. Furthermore, Coupang is not the only company employing night or early morning workers. Rather than making emotional judgments, it is essential to accurately understand the reality through scientific analysis and investigation.

This has led to misunderstandings, such as the belief that Coupang is being targeted because its founder is an American citizen or because its dawn delivery workers left the Korean Confederation of Trade Unions. Despite repeated declarations by previous governments to foster unicorn companies, no domestic investor paid attention to Coupang in its early years when it posted annual losses of hundreds of billions of won. It was large overseas investors, including SoftBank Vision Fund, who invested trillions of won and helped the company grow. Although the founder is an American citizen and foreign investors have backed it, Coupang is one of the most successful unicorn companies and represents a significant innovation born in South Korea.

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Some dismiss Coupang as merely an Amazon copycat platform, but it is an innovative company that has responded to the demands of Korean consumers familiar with the internet and online shopping by making rocket delivery and dawn delivery possible in online distribution. However, as consumers receive deliveries at home, even at dawn, national logistics costs increase and so does the risk to workers.

Amazon in the United States also provides delivery, but encourages customers to pick up their orders directly and has implemented several systems to make this more convenient. For example, non-premium customers are charged delivery fees. Instead, pickup desks are set up in front of stores so customers can pick up their orders themselves. To further support customer pickups, pickup zones are created in parking lots, and when customers arrive and call to check in, staff bring the goods directly to their cars.

If companies are sanctioned and dawn delivery is halted without any countermeasures, not only the company but also the workers and consumers involved will all suffer disadvantages. While illegal acts should be identified and punished by judicial authorities, the government should not simply criticize and sanction a single company. Instead, it should encourage a consumer culture where consumers also play a role in the logistics process. When a leading unicorn company faces difficulties, we must consider who truly benefits. Although people say that a strong economy depends on strong companies, if the government intervenes in every aspect of business operations and tightens regulations, it becomes unclear for whose benefit the bell tolls. Sanctions are not always the answer.

Kim Hongjin, CEO of Work Innovation Lab